The great iPhone crunch: Stock shortage or Strategy?

Couldn’t get your hands on iPhone7 after waiting for it in a long queue? Don’t be disappointed, there are thousands of fellow- Indians in same boat.

The long awaited launch of the smartphone was marred by complaints that Apple failed to provide enough units to Indian consumers, resulting in its black-coloured variants being sold for a premium up to Rs 40,000 in the grey market.

“There was a dire shortage of the product this time, and I had to cancel several pre-orders for customers who only wanted its black variants,” a retailer told on the condition of anonymity. “The demand for jet black editions of the iPhone7 and iPhone7 Plus is really high. However, Apple has been able to provide very few units of that kind – the ratio of orders and units received in that regard is 100:1.”

Grey market operators had been holding on to their stock in anticipation of Saturday’s sale, he said. “From early that morning, they began selling the products at a premium of anywhere between Rs 10,000 and Rs 40,000.”

This is not the first time that Apple failing to meet the customers’ demand for its hottest product. Initial stocks of the iPhone 7 Plus were sold out globally very soon after its launch. While every colour variant of the iPhone 7 Plus disappeared in a blink, it was the jet black version of its smaller cousin that was the first to be swiped off the shelves.

Though all Apple stores have run out of stock, customers continue to place online orders for the models they desire. “We sincerely appreciate our customers’ patience as we work hard to get the new iPhone into the hands of everyone who wants one as quickly as possible,” Apple spokeswoman Trudy Muller said in a statement.

But India seems to be a different ball game, with retailers alleging corruption in the allocation process. “Many units were deliberately moved to the grey market, so more profits could be reaped through the creation of a false demand. Meanwhile, customers had to return home empty-handed,” another retailer stated.

Experts discounted the conspiracy theory. “It may be part of a strategy shift. Apple is probably trying to sell more of its products in tier-2 and tier-3 cities through online partner Flipkart,” an analyst said.

Retailers did not agree. “As far as we know, Apple had allocated 1.25 lakh units for India – out of which 70,000 made it here. However, only 10,000 units were shared with big Apple partners. So what happened to the rest of the stock? Did all of these go to the online partner?” one of the retailers asked. The Cupertino-headquartered giant plans to sell five lakh units in the first 15 days after the launch, he added.